Power agent Rich Paul launching Klutch Conversations during NBA All-Star weekend
- Rich Paul is the CEO of Klutch Sports Group, the agency that represents Los Angeles Lakers stars LeBron James and Anthony Davis.
- Since its start in 2012, Klutch has negotiated over $1 billion in total contracts.
One of the most potent agencies in the world will use one of the most popular sporting events to kick off a new discussion panel that aims to jump-start social conversations.
Rich Paul, the CEO of Klutch Sports Group, will partner with Chicago hip-hop star Chance the Rapper's SocialWorks and food manufacturing giant General Mills to begin the first installment of "Klutch Conversations," he told CNBC.
It will include a discussion that will take place at the Harold Washington Cultural Center on Friday, the start of the National Basketball Association's All-Star Weekend festivities in Chicago.
Paul, a well-known sports agent and representative of Los Angeles superstar LeBron James, said he wants to use the discussion to empower youth through not only education, sports and civic engagement, but financial literacy.
"There are no dinner-table conversations educating to what's going on about how to understand credit, how to understand how Bob Iger is now the CEO of Disney," Paul, 39, told CNBC in an interview. "What does that mean? How does someone get to that point? We don't grow up understanding those dynamics. We grow up understanding that life is hard, and it's going to be difficult for me to make it out [of underprivileged environments]."
Paul said he was motivated to start this venture by the lack of life discussions in cities that host one of the NBA's top events. He wants to offer the Chicago public school students in attendance more than a weekend of fun experiences but what he labels a "conversation of value."
"The weekend comes and goes. You have activities, the jam sessions ... the dunk contest — all of these things that most of these kids probably can't afford to pay and go see. And then you have the game and then Monday, everybody is gone," he said. "Tell me, what can they take from it besides the fan experience to help them going forward in life? Nothing.
"The whole goal is to help these kids understand how to take the proper steps in life," Paul continued. "Whether that's decision-making, whether that's financial. The conversation is just one of how to take the proper steps."
Paul said content from the conversations will be captured, and there could be an opportunity to partner with a media company to air the dialogue.
And there could be a future partnership with WarnerMedia's HBO, which already has an existing deal with James to air "The Shop," featuring business partner Maverick Carter. The pair use a barbershop-style dialogue to discuss sports, culture, music and world events.
Another avenue for Klutch Conversations could come via streaming services, which appear to be making a strong push for more celebrity-driven content. YouTube recently dished out a record $20 million for a docuseries featuring pop star Justin Bieber.
After its launch this week, Paul plans to take Klutch Conversations to different cities, with its next destination expected to be in Cleveland. Travel to New York, Washington, D.C., and Philadelphia will also be considered.
Drew Hawkins, the CEO of Edyoucore, a financial consulting firm that partnered with the NBA and NBPA to provide mandatory consultation for all 30 teams, said Klutch Conversations is "critical" to continuing the dialogue with youth in efforts to empower their financial future.
"We don't introduce financial literacy, for the most case, period," said Hawkins, who also served as the former head of Morgan Stanley wealth management's global sports and entertainment division. "You can graduate from Yale or Harvard with a degree in finance, but yet you don't have the ability or understanding to balance a checkbook or to get a credit card or understand how credit works."
Klutch Conversations is the second of two new ventures for Paul, who is positioning the company for an active 2020. Klutch recently entered the National Football League's agency ranks with its acquisition of Revolution Sports, owned by agent Damarius Bilbo.
Now under Klutch's new football division, Bilbo leads a group with top players, including Cleveland Browns wideout Jarvis Landry and New Orleans Saints running back Alvin Kamara. Paul also partnered with Beverly Hills-based United Talent Agency, one of the top entertainment agencies, which will allow Klutch to grow UTA's sporting division.
Klutch, which started in 2012, has negotiated more than $1 billion total contacts and ranks 27th on Forbes' 2019 Most Valuable Sports Agencies list. Paul, who also reps Lakers star Anthony Davis and Washington Wizards star John Wall, ranked 19th on Forbes Most Powerful Sports Agents list, bringing in roughly $36 million in commissions last year.
Also, Paul is coming off a week where his name made the headlines as a candidate to replace Steve Mills, who was fired as president of the New York Knicks. He told CNBC the timing to depart Klutch and oversee an NBA team is "premature" but vouched for longtime player-agent Leon Rose, who will reportedly take over as Knicks president of basketball operations.
If Knicks owner James Dolan officially hires Rose, he'll be using an agent-turned-executive model to build his new front office, which is a model growing in popularity among NBA owners. The model suggests the agent, who already has relationships with superstar players, could be a force in attracting top stars to the hiring team.
"The model is justifiable," Paul said. "As an agent, you probably know the talent through and through more than anybody. And you're able to [understand] the talent different than what someone who is just inside of an organization can."
"I think Leon could do the job. I think he's been around the game long enough to understand what it entails and what it takes," Paul said. "I don't know how much time he'll be given, but I know he understands it's not easy, and it's especially not easy in that environment. But I wish him the best of luck."